The China Banking and Insurance Regulatory Commission (CBIRC) has removed the 51percent cap on foreign ownership of insurance companies.
The move is part of new rules amending the country’s regulations relating to foreign-funded insurance companies.
The Commission said it had issued the Decision on Amending the Implementation Rules of the Regulations of the People’s Republic of China on the Administration of Foreign-funded Insurance Companies, “in order to implement the decisions and deployments of the Party Central Committee and the State Council on expanding the opening up of the financial industry, and to further improve the regulations”.
The Decision added a requirement that “investment in a foreign-funded insurance company that affects or may affect national security shall conduct a foreign investment security review in accordance with the law”.
The amendments further clarify the entry standards for foreign insurance group companies and foreign financial institutions to invest in foreign insurance companies. “The Decision resolutely implements the requirements of opening to the outside world, follows the principle of consistent domestic and foreign investment, focuses on strengthening risk management and control, and strives to create a market business environment that is conducive to fair competition and common development between China and foreign investment,” said the CBIRC.
It added that the Decision clarified the access conditions for foreign insurance group companies and overseas financial institutions, as well as improving shareholder changes and access requirements. “It is stipulated that if a foreign-funded insurance company changes its shareholders and the proposed transferee or successor is a foreign insurance company or a foreign insurance group company, it shall comply with the relevant requirements of the regulations and the Implementation Rules,” the Commission said.
The Commission said it will continue to optimise the investment and operating environment of the insurance industry, further stimulate market vitality, and improve the quality of insurance services.